News

Summary Results Galantas First Quarter 2012

GALANTAS GOLD CORPORATION

TSXV & AIM : Symbol GAL

GALANTAS REPORTS RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2012

May 29th, 2012 : Galantas Gold Corporation (the ‘Company’) financial results for the Three Months Ended March 31, 2012 have been published. The Net Loss for the three months ended March 31,2012 amounted to CDN$ 643,389 compared to a Net Loss of CDN$ 319,985 for the Three Months Ended March 31, 2011.

Financial Highlights:

All in CDN$

Three Months Ended, March 31 2012

Three Months Ended, March 31 2011

Revenue

$ 1,025,146

$ 1,202,141

Cost of Sales

$ 1,020,507

$ 1,028,862

Income before the undernoted

$ 4,639

$ 173,279

Amortization

$ 184,565

$ 140,133

General administrative expenses

$ 455,462

$ 348,133

Foreign exchange (gain) loss

$ 8,001

$ 4,998

Net Loss for the quarter

$ ( 643,389)

$ (319,985)

Sales revenues for the three months ended March 31, 2012 amounted to $ 1,025,146 (Q1 2011: $ 1,202,141) despite the increased gold prices in the current quarter and with production only marginally below first quarter 2011 production levels. The first quarter 2012 revenues were adversely impacted by a downward revision on December 2011 revenues arising from an over estimation of concentrate grades on December shipments.

Cost of sales for the three months ended March 31, 2012 amounted to $ 1,020,507 (Q1 2011: $ 1,028,862) were in line with cost of sales for the three months ended March 31, 2011.

General administrative costs increased to $455,462 (Q1 2011: $348,133) due to a number of factors including increases in insurance costs at the mine, travel costs, heath and safety costs and higher general administration costs following the relocation to new offices.

For the three months ended March 31, 2012 Galantas incurred a net loss of $643,389 (Q1 2011: $ 319,985) for the year three months ended March 31, 2011.

The Company had cash balances at March 31, 2012 of $2,924,890 compared to $ 4,240,081 at December 31, 2011. The working capital deficit at March 31, 2012 amounted to $ 2,072,975 which compared with a deficit of $ 536,142 at December 31, 2011.

Production Highlights:

Three Months Ended March 31, 2012

Three Months Ended March 31, 2011

Tonnes Milled

9,420

6,962

Average Grade g/t gold

3.54

4.00

Dry Tonnes Concentrate

268.0

282.5

Concentrate Gold Grade (g/t)

108.4

100.3

Gold Produced - kg (troy ozs)

29 kg (932.5oz)

28.3 kg (910oz)

Concentrate Silver Grade (g/t)

260.7

269.4

Silver Produced kg (troy ozs)

69.9 kg (2,247oz)

76.1 kg (2,446oz)

Lead Produced (tonnes)

24.9

50.1

Gold Equivalent ( troy.ozs)

1,006

1,063

Production at the Omagh mine during the three months ended March 31, 2012 as summarized above was below production levels of the first quarter 2011 and also below production levels of subsequent quarters of 2011. Tonnes milled during the three months ended March 31, 2012 totalled 9,420 tonnes (Q1 2011: 6,962 tonnes). Concentrate production for the first quarter 2012 declined by 5% to 268 dry tonnes (Q1 2011:282.5 dry tones). Gold equivalent output for the three months ended March 31, 2012 declined by 5% to 1,006 ozs (Q1 2011:1,063 ozs).

During the first quarter the mill was fed with a combination of lower grade ore which was blended with ore from other sources. Production was restricted over a three week period when a large amount of clay from the low grade material passed through the standard cone crusher and by unplanned downtime in the plant. However recoveries improved during the quarter.

The main mine production focus during the quarter has been on the open pit mining of the Kerr vein and the processing of ore from the low grade stockpile. Mining from the Kearney pit was restricted during the quarter which resulted in additional ore being mined from lower grade areas. Production from Kearney was restricted due to limitations in the disposal of surplus rock which had been stockpiled over a period of time from earlier mining at the Kearney pit. Whilst the mine is required under its planning permission to dispose of the surplus rock from the site the consent to transport the surplus rock offsite was not confirmed by the relevant local authority until February 2012.

Exploration

The drilling program, with six drills operational, continued during the first quarter of 2012 with twelve additional holes being drilled covering 2,626 metres of exploration drilling on the Kearney and Joshua veins. This exploration program is seeking to expand the resources on veins close to the existing operating gold mine. Assay results released to date from both the drilling and channel sampling programmes have been encouraging with significant gold intersections being identified.

In addition Omagh Minerals was granted four new prospecting licenses in the Republic of Ireland during the quarter in an area that forms a westerly extension to the existing OM4 license.

Discussions with the regulatory authorities in Northern Ireland continued during the first quarter of 2012 when Omagh Minerals obtained confirmation of planning permits to transport surplus rock offsite to be integrated into the local aggregate industry. Permission is awaited regarding four planning applications which were submitted to the planning service authorities during the fourth quarter of 2011. Two of these were in connection with proposals to drill boreholes to determine mineralization at depth on the Kearney and Joshua veins. The remaining two were in connection with the construction and renovation of passing bays for the removal of surplus rock and the construction of a lower portal structure and truncated adit for underground mining on the Kearney vein. Additionally a further permitting application will require to be submitted by the mine in order to make additional ore available for mining and in particular for the proposed potential underground mine on the Kearney/Joshua deposits. Further progress was made on both the underground development plans and the surface infrastructure development plans during the quarter. The underground mine plan is being finalized and the Environmental Impact Assessment is now at draft stage and is being reviewed in detail prior to final sign off.

Outlook

Further results are awaited from the deep hole testing program on the Kearney vein.

A further six shorter holes are being drilled on lands owned by Omagh Minerals Ltd to the west of the current Joshua vein where the known strike and depth of mineralization continues to increase as drilling intercepts the vein progressively northwards. Some new results have been received on Joshua vein. These are under-going verification procedures and will be announced shortly.

A planning application has been drafted for sixteen further drill hole locations which target Joshua in the north, south and central regions.

The Company reported during the quarter that it had appointed ACA Howe International Ltd to prepare an Interim Resource for the Omagh Gold Project to Canadian National Instrument (NI) 43-101 standard. The report will estimate mineral resources and will comment on the Company’s Underground Mining Scoping Study. The report was expected to be published by the end of May but the Company now expects it by mid June 2012.

The detailed results and Management Discussion and Analysis (MD&A) are available on www.sedar.com and www.galantas.com and the highlights in this release should be read in conjunction with the detailed results and MD&A. The MD&A provides an analysis of comparisons with previous periods, trends affecting the business and risk factors. Some of the production and metal figures are provisional and subject to averaging or umpiring provisions under the concentrate off-take contract with Xstrata Corporation detailed in a press release dated 3rd October 2007.

Qualified Person

The financial components of this disclosure has been reviewed by Leo O’ Shaughnessy (Chief Financial Officer) and the production components by Richard Crew (Chief Operating Officer), qualified persons under the meaning of NI. 43-101. The information is based upon local production and financial data prepared under their supervision.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws, including revenues and cost estimates, for the Omagh Gold project. Forward-looking statements are based on estimates and assumptions made by Galantas in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that Galantas believes are appropriate in the circumstances. Many factors could cause Galantas’ actual results, the performance or achievements to differ materially from those expressed or implied by the forward looking statements or strategy, including: gold price volatility; discrepancies between actual and estimated production, actual and estimated metallurgical recoveries and throughputs; mining operational risk, geological uncertainties; regulatory restrictions, including environmental regulatory restrictions and liability; risks of sovereign involvement; speculative nature of gold exploration; dilution; competition; loss of or availability of key employees; additional funding requirements; uncertainties regarding planning and other permitting issues; and defective title to mineral claims or property. These factors and others that could affect Galantas’s forward-looking statements are discussed in greater detail in the section entitled “Risk Factors” in Galantas’ Management Discussion & Analysis of the financial statements of Galantas and elsewhere in documents filed from time to time with the Canadian provincial securities regulators and other regulatory authorities. These factors should be considered carefully, and persons reviewing this press release should not place undue reliance on forward-looking statements. Galantas has no intention and undertakes no obligation to update or revise any forward-looking statements in this press release, except as required by law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.